🚨 Bonus Depreciation May Be Back – Here’s What Business Owners and Real Estate Developers Need to Know

Published by Yadvisory.com – June 2025

The tax world is buzzing again – and if you’re a business owner or real estate developer, this time it’s for good reason.

Congress is moving closer to approving a new tax bill that would revive and extend 100% bonus depreciation, a key incentive that many savvy investors and operators have used to supercharge their returns and reduce tax liabilities. If you’ve felt the pinch since the phasedown began in 2023, you’re not alone — but relief may be just around the corner.

What’s Happening with Bonus Depreciation?

Under the Tax Cuts and Jobs Act of 2017, businesses were allowed to immediately deduct 100% of the cost of qualifying assets — think heavy equipment, machinery, and certain property improvements — in the year the asset was placed in service.

But starting in 2023, that benefit began to fade:

• 2023: 80% bonus depreciation

• 2024: 60%

• 2025: Set to drop to 40% without new legislation

Now, a bipartisan tax proposal is making waves in Washington with the potential to retroactively restore 100% bonus depreciation for 2023 and 2024, and extend it through at least 2026.

Why This Matters for You

If you're in real estate development or run a business that invests heavily in capital assets, this change could significantly impact your cash flow, project feasibility, and overall tax strategy.

Here’s how:

• Immediate Tax Write-Offs: Accelerated depreciation means larger deductions up front — freeing up capital to reinvest in more deals, equipment, or hiring.

• Retroactive Opportunities: If passed, you may be able to file amended returns or apply changes to your 2024 filings.

• Enhanced ROI: For developers using cost segregation studies, 100% bonus depreciation can dramatically increase first-year deductions.

At Y Advisory, we’ve worked with countless clients to structure deals and acquisitions around bonus depreciation strategies. The temporary phase-out changed the game — but this new bill could bring it right back into play.

What Should You Do Now?

Even though the bill isn’t law yet, preparation is key. Here’s how to stay ahead:

1. Review Past Purchases: Assets placed in service in 2023 or 2024 may become eligible for retroactive 100% depreciation.

2. Reevaluate Current Projects: If you've delayed equipment purchases or improvements, this could be the time to act.

3. Plan New Acquisitions Strategically: Timing could be everything. A well-structured purchase now might qualify for major savings if the bill is passed.

4. Consult Your Advisors (That’s Us): Tax planning isn’t just about compliance — it’s about optimization. Let’s look at how this could impact your overall business strategy.

   
   

Final Thoughts

Tax laws change. Smart business owners and developers don’t just react — they plan. Whether you're buying heavy machinery, building a new multifamily property, or upgrading your warehouse, this upcoming legislation could be the key to unlocking significant tax benefits.

We’re watching this bill closely — and as soon as it becomes law, we’ll be ready to help you act fast.

📞 Let’s talk about how bonus depreciation could impact your business — before, during, and after this bill is passed. Contact Y Advisory today.

Y Advisory provides strategic tax planning and consulting for business owners, investors, and real estate developers. We don’t just manage your numbers — we help you build long-term wealth through smarter decisions.